We propose the development of allow cost instrument capable of recording the fetal magnetocardiogram (fetal-MCG). This totally non-invasive instrument is intended to contribute to the assessment of fetal stress and the diagnosis of fetal cardiac arrhythmias. The fetal-MCG system provides unique information that is difficult or impossible to obtain with any other instrument. HYPRES, Inc., a world leader in superconducting electronics, is teaming for this project with Biomagnetic Technologies, Inc., the pioneer and leading supplier of biomagnetometer systems. Professor John Wikswo of the first time, digital SQUIDs for the critical sensor component of the system. The use of this new digital SQUID technology will dramatically reduce the cost of the system by eliminating the need for very expensive shielded rom and by simplifying the electronics. In the Phase I project, we have developed and demonstrated all of the components of the digital SQUID circuit, designed the complete system, and calculated the expected system performance characteristics. In PhaseII we will produce and demonstrate at least one complete prototype suitable to initiate detailed clinical studies. PROPOSED COMMERCIAL APPLICATIONS: The instrument developed has the potential of becoming as essential tool for diagnosing fetal stress. The use of digital SQUIDs in this instrument will lead to significant saving in the fetal-MCG system cost due to the elimination of the need for a shielded room and the simplication of the electronics. The successful demonstration of he digital SQUID technology here would also open the door for commercialization into other biomagnetometer applications including Magnetic Source Imaging (MSI) to localize brain function for surgery or epilepsy treatment, and to localize cardiac arrhythmogenic tissue or to determine patients at risk for sudden cardiac death.